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Auto1 Group GmbH is partnering with Deutsche Bank AG and Allianz SE as the German startup expands into fintech to ease financing for customers buying its used cars.
The three partners together own more than 50 percent in a new company called Auto1 Fintech, that will offer refinancing loans and insurance products to car dealerships buying SoftBank Group Corp.-backed Auto1’s vehicles, co-Chief Executive Officer Hakan Koc said Wednesday in an interview.
The loan payment and refinancing confirmations will be recorded on a blockchain. The new process will ostensibly allow dealerships to immediately refinance their purchases, rather than using a paper-based process which can tie up their equity for over two weeks. Auto1 hopes that the new blockchain platform will help the company diversify its offerings and promote customer loyalty. According to Koc:
“We are freeing capital and our customers are more liquid as a result. It’s a win-win.”
The move is part of Auto1’s push to diversify its offerings and encourage customer loyalty as it seeks to become the dominant Internet platform for used automobiles. SoftBank’s Vision Fund invested 460 million euros ($540 million) in Auto1 earlier this year, valuing the Berlin-based company at about 2.9 billion euros.
Other automotive companies around the world are testing blockchain technology applications ranging from simple financial transactions to autonomous driving support. In a pilot project, Daimler AG, the auto giant behind Mercedes-Benz, launched a blockchain based program to reward eco-friendly driving. Drivers who practice environmentally-friendly driving habits i.e. smooth and safe driving at low speeds, will receive MobiCoins, which they can then exchange for VIP tickets to events and other rewards.
In March, American automotive giant Ford Motors filed a patent for a vehicle-to-vehicle communication method that involves the exchange of crypto tokens to manage traffic flow. One example of a potential interaction would be if a driver were running late for an appointment, they could request to pass other vehicles for the next 10 minutes in exchange for a certain number of tokens.